HUD plan would hike rents 21 percent for poor, study finds

Secretary of Housing and Urban Development Ben Carson unveiled the plan in April.

The average Chicago-area household that relies on federal public housing subsidies would face a 21 percent rent hike under a major overhaul proposed by the Trump administration, according to an analysis by a Washington think tank.

Secretary of Housing and Urban Development Ben Carson unveiled the plan in April, saying its proposed changes would encourage more public housing recipients to work and help reduce the federal budget deficit. But the move could also make life more difficult for people who depend on federal housing subsidies, wrote Will Fischer, senior policy analyst at the left-leaning Center on Budget and Policy Priorities, which conducted the analysis.

"Raising rents on low-income people would force them to divert resources from other basic needs and expose some to eviction and homelessness," Fischer wrote on the non-profit's website. "Most of those affected would be working-poor families with children, seniors, and people with disabilities."

The change would affect nearly all of the 89,300 Chicago-based households that rely on federal housing assistance, the center found. The average annual gross rent per affected household here would rise by $800, or 21 percent, to $4,590, the analysis shows.

HUD's housing voucher program subsidizes the rent of low-income people so that housing costs equal no more than 30 percent of their adjusted income. HUD wants to change the way income is calculated and, in some cases, raise the income threshold to 35 percent. The proposal would also allow public housing agencies to impose work requirements on people who receive assistance.

For people who receive housing vouchers through the Chicago Housing Authority, the average annual household income was $13,009 last year, according to HUD. Wages were a major source of income for 31 percent of CHA voucher recipients, while welfare was a major income source for 5 percent.

A CHA spokeswoman declined to comment.

The federal changes would result in higher rents for voucher recipients in every state, according to the CBPP. Nationwide, the average annual gross rent per affected household would rise 20 percent under the HUD plan, the analysis found.

When it unveiled the proposal, called the Making Affordable Housing Work Act, in April, HUD said it would set the agency on a "more fiscally sustainable path." The measures would overhaul a formula to calculate federal housing assistance that was created in 1981.

"HUD is seeking to reform decades-old rent policies that are confusing, costly and counterproductive, in that the incentives they create often fail to adequately support individuals and families receiving HUD rental assistance in increasing their earnings," HUD said in April.

"We appreciate the center for helping us have this important conversation," he said. "We think the center's analysis ignores how this proposal would protect senior and disabled households from any increase to their rents for six years."

The changes would affect 37,500 people aged 62 and older in the Chicago area and 19,100 people with disabilities, according to the report.

Sullivan said he did not know how much money the proposed changes would save the federal government. The measures still must be approved by Congress and signed into law by President Donald Trump, who appointed Carson HUD secretary in late 2016.